During the past half century, the energy economy in the developed world has emphasized size: big dams and large, centralized generating stations burning fossil fuels or splitting atoms to generate massive quantities of electricity that is distributed regionally by the grid. Now that trend seems to be reversing.

Small-scale distributed generation, or “micropower,” has come to be defined as the growing sector of electrical supply that encompasses combined heat and generation facilities (whether biomass or fossil fueled) plus renewables, excluding large hydro. In 2008 micropower produced 17 percent of the world’s electricity, surpassing the global output of nuclear power plants by several percentage points.

Micropower harnesses the most appropriate local energy resources for local use. In practice this may mean solar PV arrays in sunny areas, wind turbines in windy areas, combined heat and power facilities burning crop residue to run a factory in India, or micro-hydro dams in Patagonia. The overarching goals are to democratize power production, improve dependabilility of the grid, rapidly deploy renewables, and lower costs and emissions by producing electricity near where it is used, thereby eliminating the line losses inherent to long distance transmission.

Micropower generating capacity is usually connected to the grid both to sell excess electricity and to ensure uninterrupted electricity when local generation isn’t possible. Even if based on fossil feedstocks such as natural gas, the “radical efficiency” of combined heat and power stations, according to micropower boosters at Rocky Mountain Institute, “typically save at least half—often two-thirds or more—of the fuel, emissions, and cost of making electricity and heat separately.” Further greenhouse gas emissions reductions are possible with renewables.

Micropower is the heart of a future distributed power system in which producers of different scales—homeowners, voluntary associations, businesses, schools, or municipalities—generate electricity for their needs and sell the excess back into the grid. This approach has numerous benefits compared to centralized generation, where one large facility produces power and distributes it to an entire region.

Unfortunately, the current grid is ill-equipped to handle a large share of distributed generation based on intermittent renewables such as solar and wind, but efforts to modernize the grid are under way. Various efforts to establish “microgrids” are making progress as well, with notable examples at the University of California at San Diego and on U.S. military bases.